Bankruptcy, a huge factor in the recent recession, can seem like the end of the world to a person, especially if it threatens to remove his or her means of transportation. Fortunately, LEAP Auto Loans has a solution for car owners who file for Chapter seven bankruptcy and might face default or repossession of their vehicle. Under Chapter seven, car owners may choose between only three options: keep the truck or car by paying the full principal balance, return the vehicle to the lender, or pay the vehicle’s fair market value in a 722 redemption. LEAP Auto Loans can assist borrowers with this third, little-known option that usually results in better financial terms than the original agreement. Customers who file for Chapter seven do not usually have the cash on hand to redeem their vehicle by paying fair market value for it, but LEAP Auto Loans will do that on their behalf.
In a 722 redemption, the company purchases the vehicle from the lender, which forestalls repossession and meets the terms of the original contract from the lender’s perspective. Then, LEAP Auto Loans leases the car or truck back to the customer at a rate that meets his or her current financial situation. This enables the borrower to retain his or her means of transportation, which often proves crucial to maintaining or finding employment, and launches the process of improving the credit rating with installment payments. This remarkable financial innovation dispels the antagonistic relationship that can develop between borrowers and lenders when the former run into trouble with their bills. Lenders get the delinquent account off their books, pocket much of the loan’s value, and lower their own risk in the long run. Sometimes the borrowers’ financial state makes repaying the fair-market value of their vehicles utterly out of their range. In such cases, LEAP Auto Loans will search for a replacement vehicle that features more suitable leasing terms. By keeping a close watch on the market and helping stressed buyers avoid repossession, LEAP Auto Loans satisfies all parties, including customers, lenders, and its own investors.
